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IN RE TRANS UNION CORP. PRIVACY LITIGATION

August 17, 2005.

IN RE TRANS UNION CORP. PRIVACY LITIGATION.


The opinion of the court was delivered by: ROBERT GETTLEMAN, District Judge

MEMORANDUM OPINION AND ORDER

Plaintiffs*fn1 in this multi-district action, have brought a seven-count second amended consolidated putative class action complaint charging defendants Trans Union, LLC, Acxiom Corp., and MCI WorldCom Communications, Inc., and MCI WorldCom, Inc.,*fn2 with various violations of the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. § 1681 et seq. (Counts I, II, V and VI); state law claims for invasion of privacy and misappropriation (Count III); unjust enrichment (Count IV); and violation of the California Business and Professional Code § 17200 (the "UCL") (Count VII).*fn3 Plaintiffs have moved for certification of three classes: (A) a nationwide putative damage class for defendants' willful violations of the FCRA; (B) an Illinois class consisting of all Illinois consumers who had their telephone number or other personal information sold or otherwise disclosed to a third party in connection with a firm offer of credit or insurance ("the Illinois Firm Offer Class"); and (C) a California class for defendants' violations of the UCL through the sale of target marketing lists. For the reasons set forth below, the motion is granted in part and denied in part.

DISCUSSION*fn4

  Fed.R.Civ.P. 23, which governs class actions, requires a two-step analysis to determine if class certification is appropriate. First, plaintiffs must satisfy all four requirements of Rule 23(a): (1) numerosity; (2) commonality; (3) typicality; and (4) adequacy of representation. These elements are a prerequisite to certification, and failure to meet any one of them precludes certification of a class. Second, the action must also satisfy one of the conditions of Rule 23(b). Joncek v. Local 14 International Teamster Health and Welfare Fund, 1999 WL 755051 at *2 (N.D. Ill. 1999) (and cases cited therein). Plaintiffs argue that all three proposed classes satisfy the requirements of Rule 23(b)(3), and that the UCL class also meets the requirements of Rule 23(b)(2).

  Trans Union and Acxiom have each raised a number of different challenges to plaintiffs' motion, most of which focus on the adequacy of representation requirement of Rule 23(a)(4),*fn5 and the requirements of Rule 23(b)(3), and all of which relate equally to all three proposed classes. Both defendants have also raised specific attacks on each of the three proposed classes.

  Adequacy of Representation

  Rule 23(a)(4) requires that "the representative parties will fairly and adequately protect the interests of the class." This requirement has three elements: (1) the chosen class representative cannot have antagonistic or conflicting claims with other members of the class; (2) the named representative must have a sufficient interest in the outcome to ensure vigorous advocacy; and (3) counsel for the named plaintiff must be competent, experienced, qualified, and generally able to conduct the proposed litigation vigorously. Joncek, 1999 WL 755051 *6-7.

  Each defendant raises different challenges to plaintiffs' ability to represent the proposed classes adequately. Acxiom argues that the individual plaintiffs do not "know and understand their rights and roles as to class representative." Acxiom points to a number of depositions of certain named plaintiffs in which they have indicated that they do not know what claims have been asserted, what classes have been proposed, and which classes they represent. This argument generally carries little weight when assessing adequacy of representation. "[T]he class representative's role is limited. It was found not to be enough to defeat class certification in Surowitz v. Hilton Hotels Corps., 383 U.S. 363, 366 (1966), that the named plaintiff did not understand her complaint at all, could not explain the statements in it, had little knowledge of what the lawsuit was about, did not know the defendants by name, nor even the nature of the misconduct of the defendants." Eggleston v. Chicago Journeyman Plumbers' Local Union No. 130, 657 F.2d 890, 896 (7th Cir. 1991). Acxiom argues, however, that when coupled with the fact that there is what it terms a "questionable relationship between many of the class attorneys and the named plaintiffs," this lack of knowledge verifies that "plaintiffs' counsel had manufactured this lawsuit and are controlling it to a prohibitive degree."

  The court disagrees. The fact that plaintiff Turner's son is a lawyer and informed her of a potential claim does not mean that she can not be a proper plaintiff. The whole point of the class action mechanism is that very often potential plaintiffs are unaware of their claims. Additionally, the fact that plaintiff Wayne is a class representative in four lawsuits brought by his counsel does not, by itself, establish that he is an improper representative. Plaintiff Wayne has sufficient, albeit limited, knowledge of the case, and defendants have produced no evidence to suggest that his participation in other suits creates a conflict for him in the instant action.

  Moreover, as noted, under Rule 23(a)(4) the class representative's knowledge is not generally the proper focus. Instead, the court should focus on the competency of plaintiffs' counsel and any conflicts between the named class representatives and other class members. See Heastie v. County Bank of Greater Peoria, 125 F.R.D. 669, 676 (N.D. Ill. 1989). There is no question that the plaintiffs' attorneys are all very experienced class action litigators who have vigorously pursued this litigation.*fn6 As to Acxiom's argument that "plaintiffs' counsel . . . manufactured this lawsuit," Acxiom forgets that the genesis of this case was the FTC's successful enforcement action, hardly a matter conjured up by opportunistic lawyers.

  Acxiom also argues that representation of the class is inadequate because some plaintiffs would be subject to individualized defenses. In particular, Acxiom challenges plaintiff Gogerty, arguing that she cannot represent the Illinois Firm Offer Class because she is not currently a resident of Illinois and was an Illinois resident for less than three of the eight years in question. Even if Acxiom is correct, there are a number of other Illinois plaintiffs qualified to represent the Illinois Firm Offer Class. Thus, denial of class certification on this ground would be inappropriate.

  Trans Union's attack on plaintiffs' ability to represent the proposed classes adequately takes a somewhat different tack. Trans Union argues that the named plaintiffs damaged the class by deciding to pursue only FCRA statutory damage claims for Illinois residents in connection with firm offers of credit, thereby waiving all other FCRA claims for other putative class members. Trans Union argues that plaintiffs allege that it willfully violated the FCRA by disclosing certain consumer information in target marketing lists. The Act provides for statutory damages of not less than $100 and not greater than $1,000 per violation. 15 U.S.C. § 1681n. Yet, according to Trans Union, plaintiffs seek such statutory damages only on behalf of certain Illinois residents, and not on behalf of the other 178 million people they purport to represent. Thus, Trans Union argues that if plaintiffs' target marketing claims go to trial, Illinois residents can recover statutory damages of between $100 and $1,000 per violation plus their share of punitive damages, while residents of all other jurisdictions will be eligible only for their share of any punitive award. Additionally, Trans Union argues that if the class is certified and the case tried, individuals who reside outside of Illinois would not have a second chance to seek statutory damages under the FCRA because of the prohibition against claim splitting.

  This argument is faulty on a number of levels. First, contrary to Trans Union's assertions, plaintiffs do not seek to certify a class on behalf of all Illinois consumers for statutory damages as a result of Trans Union's sale of target marketing lists. The Illinois class seeks statutory damages for consumers whose telephone numbers or other personal information was sold to third parties in connection with a firm offer of credit. This is a much smaller class than that described by Trans Union in its argument, and Trans Union makes no effort to demonstrate how certification of that class could prevent claims by consumers from other jurisdictions whom plaintiffs do not seek to represent.

  Moreover, and perhaps more importantly, Trans Union's argument seeks to put plaintiffs into a "Catch-22" situation. In Trans Union I, Trans Union argued against certification of a nationwide statutory damage class because such a class action was not the superior method for the fair and efficient adjudication of the controversy. The argument was based in large part on the enormity of the putative FCRA class — approximately 190 million people. The court agreed with Trans Union, holding that the potential for damages, which were grossly disproportionate to any actual harm, made a class action an inferior method to adjudicate the FCRA claims. Trans Union I, 211 F.R.D. at 351. Having defeated plaintiffs' efforts to represent all those allegedly injured nationwide, Trans Union's suggestion that by seeking to represent a smaller class plaintiffs have now sold out the "rights of most putative class members" to "advance the interest of no one other than plaintiffs' ...


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